Second stage of government stimulus package for 2020
On 22 March 2020, the Australian government announced the second stage of its economic plan to cushion the economic impact of the coronavirus and help build a bridge to recovery. Here is a summary of key points in the government stimulus package.
KEY POINTS
- The Jobseeker (Newstart) payment increased by $550 per fortnight (inclusive of Jobseeker payment, Youth Allowance, Parenting payment, farm household allowance, and special benefit).
- For people who are not eligible for the extra Newstart payment, an additional $750 – the first payment on 31 March, the second on 13 July.
- Income and asset tests and waiting times will be waived for those who lose their jobs and apply for the Jobseeker program.
- Individuals in financial stress can access up to $10,000 of their superannuation in 2019-2020, and a further $10,000 in 2020-21. This will be available to individuals who
- are unemployed, or
- are eligible to receive a JobSeeker (Newstart) payment, youth allowance for job seekers, parenting payment, special benefit, or farm household allowance, or
- from 1 January 2020
- – were made redundant, or
- – had their working hours reduced by 20% or more, or
- – for sole traders, their business was suspended or there was a reduction in their turnover of 20% of more.
To access the benefit (for non-SMSF members) individuals will apply to the ATO via My Gov. The ATO will provide the fund and individuals with a determination. For SMSF members, guidance has not yet been released.
- Expanding the small business support payments from $25,000 to up to $100,000. This includes not-for-profits. The minimum payment will be $20,000. The first payment will be a payment of up to 100% of wages tax paid (up from 50 percent) with the maximum at $50,000. The payment will be from 28 April. The second payment, to match the first, will be from 28 July.
- A reduction of the compulsory superannuation drawdown rates by 50 percent for 2019-20, and 2020-21.
- A government guarantee on 50% of fast-tracked loans issued by lenders.
- Changes to thresholds on which creditors can issue statutory demands and the time companies have to respond.
- Temporary relief for directors from personal liability if they trade whilst insolvent.
- The Victorian state government will offer a refund of payroll tax paid by eligible business (payroll of less than $3 million) in the first three quarters of this financial year. Business should be able to access this by 27 March 2020. This will provide business a maximum of $113,475, but limited to the amount of payroll tax paid.
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